Fund Administration
The administration of an undertaking for collective investment (UCI) includes all back-office functions in the widest sense of the term, notably:
- legal and fund management accounting services
- customer inquiries
- valuation of the portfolio and pricing of the units/shares (including tax returns)
- regulatory compliance monitoring
- maintenance of unit-/shareholder register
- unit/shares issues and redemptions
- contract settlements (including certificate dispatch)
- record keeping
Luxembourg law requires that tasks belonging to the central administration be carried out in the Grand Duchy. However, the central administration can outsource some of these functions. Luxembourg has a wide range of specialist service providers:
- transfer agents specialise in the execution of subscription and redemption orders for fund shares and units and in maintenance of the share-/unitholder register;
- domiciliation agents provide UCIs with a correspondence address and help in fulfilling legal and regulatory obligations (such as reporting, organising shareholder general meetings and board meetings, handling legal publications and sending information to share-/unitholders);
- paying agents handle the payment of dividends and other sums due to the investors.
These specialist service providers are themselves authorised and regulated by the financial sector supervisory authority, the CSSF.
It is a legal requirement for all Luxembourg UCIs, regardless of their legal form, to keep their assets with a depositary. This function includes safekeeping and surveillance of the assets in line with the law, which requires that the depositary "must know at every moment how assets are invested and where and how these assets are available".
Finally, annual reports and other legally required reports must be certified by approved auditors.
